Does the single farm payment affect farmers’ behaviour? A macro and micro analysis

Peter Howley, James P. Breen, Cathal O. Donoghue and Thia Hennessy

International Journal of Agricultural Management, 2012, vol. 02, issue 01, 8

Abstract: Using Ireland as a case study, the overall aim of this paper is to determine if decoupled payments affect farmers’ behaviour. Using a dynamic, multi product, partial equilibrium model of the EU agricultural sector, this paper first compares levels of production that would be expected if decoupled payments had no impact on farmers’ activity with actual observed outcomes. Second this paper compares cereal and cattle farmers’ profitability prior to decoupling with that observed after the introduction of decoupled payments. The analysis presented here would suggest that decoupled payments do still maintain a significant effect on agricultural activity with farmers using this new form of support to partly subsidise unprofitable farm production.

Keywords: Agricultural and Food Policy; Farm Management; Institutional and Behavioral Economics (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (12)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:ijameu:159248

DOI: 10.22004/ag.econ.159248

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